The Lao rice sector is growing fast. Traditionally, rural farmers grow sticky rice for self-consumption, but the number of smallholders who supply rice to the market is slowly increasing, not least because of SNV’s rice projects. SNV has been working with rice mills for several years. The approach was pioneered with the "Enhanced Milled Rice Production" (EMRIP) project. In short, it uses rice millers as an entry point in the value chain, improves their milling capacity and quality and encourages them to organize small-scale rice farmers in groups. The rice millers train farmers on modern farming methods and provide them with fertilizer, seeds and loans. The farmers can sell rice on the market and gain income.
But there are many different practices in the Lao rice sector. Therefore, on an early Tuesday morning, 34 rice millers and SNV advisors from Khammouane undertook a study trip to the South of Laos. “The idea was to share experience between the provincial governments in three provinces about commercialized rice production. We also wanted entrepreneurs to share their successes and failures and encourage them to work together", said organiser of the study tour, Mr Viseth Khodsuvanh, Head of Products Development and Promotion Section, from the Department of Industry and Commerce Khammouane. Aside from officials of the Provincial and District Departments of Agriculture and Forestry as well as Industry and Commerce, three junior SNV advisors Anousone Luanglath, Chanthachone Singmanychanh and Phitsada Silivongsa also joined the tour. Several rice millers from the Khammouane districts of Mahaxai, Nongbok, Xebongfai and Thakhek completed the group. They all work with one of the two ongoing rice projects, "Building Income, Independence and Empowerment for Farmers” (BIIE) in Khammouane. The trip was funded by the Smallholder Development Project (SHDP) and BIIE.
In meetings with the DIC in Savannakhet, Paksé and Salavan, the group exchanged experiences and lessons learned with their local counterparts: How do private companies support farmers? How do they market their products? How can groups and associations be formed? One of the local experts in Salavan is Khamphone Soulipeng, Agribusiness Liaison Officer for the Helvetas LEAP project. He spoke very highly of the rice millers in Khammouane: “In Khammouane they work. Here they just talk. But if we exchange experiences, maybe they can learn.” He adds: “The guests brought some very good lessons. They have a lot of knowledge about working actively with farmers and supporting them. Here they are just registered, but then there is no more contact. Quality of rice is still low. Both miller groups should work together. It’s a very good opportunity.” The difference between the rice sectors in Salavan and Khammouane in terms of quality and productivity is high. Mr Khamphone attributes this to the long history of rice projects in the central province. “The work of SNV and Helvetas was important. The situation is so different because SNV was working in Khammouane for a long time.”
To gather information about how private enterprises work with farmer groups, the study group visited the Chinese-owned Dok Mai Daeng cigarette factory in Savannakhet and the coffee growing cooperatives on the Bolaven Plateau. The tobacco factory, which churns out 200’000 boxes of cigarettes per month, buys tobacco from local farmers, trains them through extension workers and provides seeds and fertilizer. “Everyone is convinced here that farmer groups ensure better quality and quantity of tobacco”, said SNV advisor Chanthachone Singmanychanh after the visit. But the junior rice value chain advisor's attention was especially drawn by the coffee growing cooperatives on the Bolaven Plateau. “They are organized very efficiently”, she said.
The rice millers from Khammouane plan to organize themselves in an association later this year. Mr Soukasem, a member of the Khammouane Development Rice Miller Group, sees the future in further cooperation. ”We have five different rice miller groups now. Each has different regulations. It’s hard to work together”, he explains. But he hopes for harmonization with the proposed association. “We could also get access to more capital and government support.” Khammouane rice millers are very capable in supporting farmer groups, while the strengths of those in Savannakhet and Champassak lie in exporting quality rice. Sharing their lessons with each other made the "study tour” more of a “teaching tour” as rice sector in each province has unique strengths. One of the insights of the trip, according to Mr Viseth, was that the Khammouane rice millers tend to forget the domestic market: “Companies like Lao world are possible customers for our rice millers.” Also, the value chain from producer to exporter in Champassak and Savannakhet is much more developed, thanks to such companies. This could be an example to imitate in Khammouane.